Researching old stock and bond certificates

You've just torn up the squeaking floorboard in your grandma's old home and discovered an old stock certificate for a gold mine. Is it now worth a fortune? Or is it suitable for wrapping fish?

The staff at the now-defunct Money Show on CBC Newsworld used to get these kinds of inquiries quite frequently. Newspapers also hear from many people who want to find out if that certificate for 1,000 shares of Consolidated Widget will put their kids through university or if it should be put out with the week's newspapers for recycling.

The bad news is that news organizations don't have the staff to perform these searches. They're usually time-consuming, the results are of little interest to the general audience, and the searches often turn up nothing. But before you run off to the professional searchers, here are a few avenues to try first.

There's a particularly useful publication in the reference section of most libraries called The FP Survey of Predecessor and Defunct Companies, published by the Financial Post Data Group. If a company underwent three name changes, two takeovers and a consolidation in the past 60 years, this is a good place to find that out. It has details on 19,000 companies that no longer exist.

You can also check with provincial government corporate registries to check if the company is still active. If the corporate charter has been cancelled, you can often find out this way. A small fee is usually charged for this search.

But frequently, your search won't end with such a categorical answer. Your company's name may not be found. Or it may be unclear whether the old shares can be converted into stock of another company that's still actively traded today. And sometimes, "defunct" doesn't mean "worthless." That's where the pros come in.

Tracking down mergers, acquisitions, spinoffs, name changes and amalgamations can be extremely difficult. Stock search firms charge fees, generally $35 to $125 to evaluate your certificate. Generally, if the search firm can't uncover any information, they'll refund your fee. But that usually doesn't happen. They can usually find something.

Now if they discover the certificate is actually worth something (which happens perhaps 10 per cent of the time), they can recover the money for you for a further fee of 10 to 30 per cent of the shares' value. Or you can try to recover the money yourself (not as easy as it may appear). You may want to pay the fee.

Some Canadian-based stock search firms are:

Stock-Search-Global is based in Orangeville, Ont., and charges $50 to research a stock certificate

Paperchase International is a Montreal company that charges $55 per stock, bond or mutual fund search. Additional recovery fees apply if you want Paperchase to do the heavy lifting of actually getting the money

But what if you find out that your certificate has no value as a security? Don't give up just yet. It could have some value as a collectible.

Thousands of people collect old stock certificates for their historical value, the signatures they have on them, or for their artwork. The hobby is called scripophily and there are many associations and professional firms that can give you an idea what your certificate may be worth to a collector.

Here are some places to start:

The International Bond and Share Society is the world's biggest scripophily organization, with members in more than 50 countries. Its site features a directory of dealers and members, along with illustrations of some of the most colourful and coveted certificates

Scripophily.com is a major U.S. buyer and seller of old stock and bond certificates in a variety of categories. They advertise more than 10,000 certificates for sale, and their site has pictures of all of them.

Note: CBCNews.ca is not endorsing or recommending any of the firms mentioned in this article.